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US treasury auctions $32 billion of 10 year note today high yield of 3.330%

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  • WI level at the time of auction was 3.303%
Greg Michalowski

  • High yield 3.330%
  • WI level 3.303%
  • Tail 2.7 basis point
  • bid to cover 2.37X vs. six-month average of 2.45X
  • Dealers 19.8%vs. the six-month average of 15.3%
  • Directs 17.9% vs. the six-month average of 17.7%
  • Indirects 62.3 percent vs. the six-month average of 67.0%

Auction Grade: D

  • Tail is well above the 6 month averageof 1.2 bps
  • Directs – a measure of domestic demand – was a touch stronger than expectations
  • Indirect – much weaker than expectations. This is a measure of foreign demand
  • Dealers were saddled with more than average.

The only thing that kept it from an F is the domestic demand but that was still at a larger than expected tail. So it is a small victory in what was an auction where demand was tepid.

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